Message Thread:
Starting Capital !!! --  0 -- 
9/10
I am planning on starting a very small shop basically to employ myself. I already have basic tools... I might need to buy some but right now I can build cabinets and some furniture with what I have. I also have 40k in the bank. I wonder if that would be enough to bring the business afloat. Rent would be around 500 per month for a 600 sq ft. Right now I am making around 35k per year. Do you guys think I can make it with what I have to at least make as much as I am making in my current job? Please advise and thank you!
9/10 #2: Starting Capital !!! ...
Dan, that's great that you want to start something new. Being concerned about working capital is also a top priority.
Have you included your living expenses in working capital? The biggest concern is where sales are going to come from? Do you have an outlet for your product?
9/10 #3: Starting Capital !!! ...
$500/month for rent for only 600sf is incredibly high......that equates to $10/sf per year. You should be able to do much better than that.
9/10 #4: Starting Capital !!! ...
Bill,
I should not worry about rent and food... my wife is willing to cover that. Of course she is putting some pressure since we could use that money as down payment for a house. Other than that, I don't have too many expenses. As for sales, I plan to look for a couple contractors that need some help. I also plan to sell small furniture through the internet. Those would be my initial outlets... what do you think?
9/10 #5: Starting Capital !!! ...
Jerry,
I live in Cali so it seems cheap to me... It's either that or a 1000 ft for $850. I believe that to start... The lowest cost is better. I prefer to have 350 spare dollars than 400 sq ft.
9/10 #6: Starting Capital !!! ...
Spend all of your capital as quickly as possible. Just kiddin.
If I could start over, knowing what I know now, I would stay small and not spend huge amounts on equipment and shop.
I have always made the best money on sales, design, and installation. I would have a SMALL shop for doing the odd thing not easily outsourced. I would outsource everything else. With companies like Conestoga and Walzcraft and plenty of people with CNCs for hire 90% would be ordered to my specs including finish.
I think that such a small business, maybe growing to a max of 2-4 people would be very profitable and could easily handle fluctuations in volume.
I think you are in a very good position to make money. Make it a business, not a hobby, learn quickly what is profitable to do yourself and what is profitable to outsource.
9/10 #7: Starting Capital !!! ...
Thank you, that's encouraging !!!
9/10 #8: Starting Capital !!! ...
You need a business plan with projected sales, and income from sales.
Rule of thumb is you need 6 months of operating expenses to open a business, this would include projected material costs, labor costs, insurance, rent, lights, utilities, water, office supplies, and the list goes on. On top of the you need financing or capital to by equipment. Once you know what these numbers are you can think about opening the doors.
I suggest you search for a local score group for FREE help. Its supported by your taxes and it will be the best free time and time investment you can make right now
A-
FREE BUSINESS ADVICE
9/10 #9: Starting Capital !!! ...
here is the link for business plans
How to Develop a Business Plan in Six Ea
9/10 #10: Starting Capital !!! ...
I was going to post earlier today, but "If I could" beat me to the punch. I echo his thoughts exactly. With only 600 sq ft, you can make ALOT more money designing, project managing, and installing component systems outsourced then you could ever hope for otherwise.
Do not borrow a dime for any equipment. You could get by with a laptop, screwdriver and tape measure for now. let the jobs pay for any machinery. Payments drag you down when the work isn't there.
9/11 #11: Starting Capital !!! ...
Website: http://www.TGCabinets.com
If you don't already have Quickbooks- get it. Use it to track all of your income and expenses. Assign POs to all of your purchases and make sure to enter it all into QB. At the end of each job run a job profitability report and see how much you made. Learn, learn, learn. Keep adjusting your pricing until you hit a good profit.
9/11 #12: Starting Capital !!! ...
ok, I will be the first to say it.
Another guy who doesn't need to worry about "rent and food". Hope you don't
live in my area code.
9/12 #13: Starting Capital !!! ...
"Do you guys think I can make it with what I have to at least make as much as I am making in my current job?" I didn't make $35,000 the first year in business, or the second year either. Nearly went belly up on a miserably underbid kitchen cabinet job at the end of the first year. How good of an estimator are you? Selling small furniture through the internet sounds like a really rough way to go. Lots of places to get small furniture on the internet, and many of them are sourced from overseas. Have you been selling work and honing your business and woodworking skills? Anyone can make it if they have the desire, but it sure isn't easy. If you have a day job, run your business part time until you have too much backlog to do both.Then quit the day job.
9/12 #14: Starting Capital !!! ...
I'll follow Rich's thoughts as I've gone a few years without making $35k. But first...is that your "real" income? Most guys forget to include the health insurance, sick days, paid vacations, and any other benefits which add quite a bit to your salary.
There are a million guys out there who can build furniture and/or cabinets. The question is can you run a successful woodworking business? I can't answer it for you that's for sure. I can tell you it's a tough economy and there's still a lot of competition. Where is your work going to come from? How are you going to market yourself? Do you have a specific type of work your ready to go with? You need a good plan of action before taking a leap like this. Contractors can be a good source of work, or not! Most are out there looking for the cheapest stuff they can get. There's a smaller segment that are interested in better quality product, but they'll probably be hesitant to use a new guy just starting out in a small shop.
There's just a lot to consider before taking this leap. Long days and working weekends. Starting to call your shop "home" unintentionally, as that's where you'll spend most of your time. Feast or famine income the first couple years of getting established. One thing you'll have to your advantage though is a ton of useful advice from some of the guys one here. I've learned a LOT from these guys and am still learning on daily basis.
good luck,
JeffD
9/13 #15: Starting Capital !!! ...
Thank you Allan... I am actually working on my business plan and will have my current boss read it and give me insights.
9/13 #16: Starting Capital !!! ...
Thank you Gary,
One of the things that makes me feel confident is... I have no debt and all the tools I have, have been bought with money that came from this hobby. I love freedom and debt is just not my thing.
9/13 #17: Starting Capital !!! ...
John,
I do not have Quick Books but I sure plan to get it before I start. I have an A A Degree in Business and also have taken some courses in Operations Management and Finace. I have been working in Accounting for over 7 years. I feel I have enough knowledge on that side. Thank you very much for your comment... I appreciate each one.
9/14 #18: Starting Capital !!! ...
Keep your day job and ease into the woodworking. Finding a continuous supply of profitable jobs will not be easy. I know from experience it takes more working $ than what most would believe. If you have to live off that 40K and use it as working capital it may be very tight. Material costs can vary widely as a % of the job. You will be paying much more than an established medium size shop. I'd look for a niche market not currently being filled. There are a lot of cabinet shops. Custom furniture is tough, I tried it long ago. I ran some #'s based on my somewhat larger shop. You will need between 9 & 10,000 a month in sales/completions. The catch is the amount of time it takes to get the information out of the customer if you are doing custom work. Don't give them too many options!
9/26 #19: Starting Capital !!! ...
Website: jgmachinery.com
If you have a product to sell online make it a narrow niche. For example custom loft and bunk beds. I like Volusion for an easy to set up and low cost ecommerce suite. Good baseline cash flow if you can find a niche that is underserved. p.s. let me know if you make some bunk beds. I want a cool one for growing teen.
disclaimer, i am a Volusion reseller but just to get their improved support plan and have not actually done any reselling outside our company.
0 --
|
Buy & Sell Exchanges | Forums | Galleries | Other Resources | Site Map
Buy and Sell Exchanges
Job Opportunities and Services Exchange
Employment opportunities and services within the woodworking industry
Lumber Exchange
A worldwide buy/sell exchange for lumber and wood products
Machinery Exchange
A worldwide buyer and seller exchange for woodworking machinery and equipment.
Classified Ad Exchange
Classified advertising for the woodworking industry (for advertisements that do not include machinery, lumber products and employment listings)
Forums
Adhesives Forum
Discussing topics related to adhesives within the woodworking industry
Architectural Woodworking Forum
Discussing quality standards and production of architectural wood products
Business and Management Forum
A forum for the discussion of business topics: from sales and marketing to dealing with difficult customers.
Cabinet and Millwork Installation Forum
Discussing all aspects of installation issues encountered by cabinet and millwork installers.
Cabinetmaking Forum
Discussing 32mm and face frame cabinet construction including fabrication, casegoods design, and installation.
CAD Forum
Shedding light on the all-too-often shadowy world of CAD.
CNC Forum
Discussing CNC (computer numerically controlled) woodworking equipment, software, and automated product manufacturing.
Dust Collection, Safety and Plant Operation Forum
Discussing topics related to maintaining a safe and productive working environment.
Professional Finishing Forum
Finishing issues for the production environment
Forestry Forum
The science and art of forest cultivation and timber management, planting, surveying, tree diseases, silviculture and timber harvesting
Professional Furniture Making Forum
Helping professional furniture makers improve quality, save time, and increase profits
Laminating and Solid Surfacing Forum
Issues related to laminating and solid surface materials and processes
Commercial Kiln Drying Forum
Discussions covering issues faced be commercial drying operations that process at least 750,000 bd. ft. of lumber per year
Sawing and Drying Forum
Discussing topics related to primary processing and drying of lumber
Solid Wood Machining Forum
Discussing topics related to the machining of solid wood
Value Added Wood Products Forum
Learn how to improve your output, find new markets, and boost sales of your lumber products
Veneer Forum
Discussing topics related to veneer processing, manufacturing, and fabrication
WOODnetWORK
An electronic discussion group for woodworkers throughout the world
Galleries
Project Gallery
Where professional woodworkers can post examples of their work
Sawmill Gallery
Professional primary processing companies display and describe their sawmill facilities
Shop Gallery
Professional woodworkers display and describe their shop facilities, products and equipment
Shopbuilt Equipment Gallery
Professional woodworker's jigs, rigs, and shopbuilt equipment
Other Resources
Industry News
Late-breaking news from all sectors of the wood industry
Video Library
Index of industrial woodworking related digital videos on the web
Auctions, Sales and Special Offers
Advertisers offering woodworkers discounted prices on good and services, and announcements of upcoming auctions
FORUM GUIDELINES: Please review the guidelines below before posting at WOODWEB's Interactive Message Boards (return to top)
WOODWEB is a professional industrial woodworking site. Hobbyist and homeowner woodworking questions are inappropriate.
Messages should be kept reasonably short and on topic, relating to the focus of the forum. Responses should relate to the original question.
A valid email return address must be included with each message.
Advertising is inappropriate. The only exceptions are the Classified Ads Exchange, Machinery Exchange, Lumber Exchange, and Job Opportunities and Services Exchange. When posting listings in these areas, review the posting instructions carefully.
Subject lines may be edited for length and clarity.
"Cross posting" is not permitted. Choose the best forum for your question, and post your question at one forum only.
Messages requesting private responses will be removed - Forums are designed to provide information and assistance for all of our visitors. Private response requests are appropriate at WOODWEB's Exchanges and Job Opportunities and Services.
Messages that accuse businesses or individuals of alleged negative actions or behavior are inappropriate since WOODWEB is unable to verify or substantiate the claims.
Posts with the intent of soliciting answers to surveys are not appropriate. Contact WOODWEB for more information on initiating a survey.
Excessive forum participation by an individual upsets the balance of a healthy forum atmosphere. Individuals who excessively post responses containing marginal content will be considered repeat forum abusers.
Responses that initiate or support inappropriate and off-topic discussion of general politics detract from the professional woodworking focus of WOODWEB, and will be removed.
Participants are encouraged to use their real name when posting. Intentionally using another persons name is prohibited, and posts of this nature will be removed at WOODWEB's discretion.
Comments, questions, or criticisms regarding Forum policies should be directed to WOODWEB's Systems Administrator
(return to top).
Carefully review your message before clicking on the "Send Message" button - you will not be able to revise the message once it has been sent.
You will be notified of responses to the message(s) you posted via email. Be sure to enter your email address correctly.
WOODWEB's forums are a highly regarded resource for professional woodworkers. Messages and responses that are crafted in a professional and civil manner strengthen this resource. Messages that do not reflect a professional tone reduce the value of our forums.
Messages are inappropriate when their content: is deemed libelous in nature or is based on rumor, fails to meet basic standards of decorum, contains blatant advertising or inappropriate emphasis on self promotion (return to top).
Libel: Posts which defame an individual or organization, or employ a tone which can be viewed as malicious in nature. Words, pictures, or cartoons which expose a person or organization to public hatred, shame, disgrace, or ridicule, or induce an ill opinion of a person or organization, are libelous.
Improper Decorum: Posts which are profane, inciting, disrespectful or uncivil in tone, or maliciously worded. This also includes the venting of unsubstantiated opinions. Such messages do little to illuminate a given topic, and often have the opposite effect. Constructive criticism is acceptable (return to top).
Advertising: The purpose of WOODWEB Forums is to provide answers, not an advertising venue. Companies participating in a Forum discussion should provide specific answers to posted questions. WOODWEB suggests that businesses include an appropriately crafted signature in order to identify their company. A well meaning post that seems to be on-topic but contains a product reference may do your business more harm than good in the Forum environment. Forum users may perceive your references to specific products as unsolicited advertising (spam) and consciously avoid your web site or services. A well-crafted signature is an appropriate way to advertise your services that will not offend potential customers. Signatures should be limited to 4-6 lines, and may contain information that identifies the type of business you're in, your URL and email address (return to top).
Repeated Forum Abuse:
Forum participants who repeatedly fail to follow WOODWEB's Forum Guidelines may encounter difficulty when attempting to post messages.
There are often situations when the original message asks for opinions: "What is the best widget for my type of shop?". To a certain extent, the person posting the message is responsible for including specific questions within the message. An open ended question (like the one above) invites responses that may read as sales pitches. WOODWEB suggests that companies responding to such a question provide detailed and substantive replies rather than responses that read as a one-sided product promotion. It has been WOODWEB's experience that substantive responses are held in higher regard by our readers (return to top).
The staff of WOODWEB assume no responsibility for the accuracy, content, or outcome of any posting transmitted at WOODWEB's Message Boards. Participants should undertake the use of machinery, materials and methods discussed at WOODWEB's Message Boards after considerate evaluation, and at their own risk. WOODWEB reserves the right to delete any messages it deems inappropriate. (return to top)
Forum Posting Form Guidelines
|
|
Your Name
|
The name you enter in this field will be the name that appears with your post or response (return to form).
|
|
Your Website
|
Personal or business website links must point to the author's website. Inappropriate links will be removed without notice, and at WOODWEB's sole discretion. WOODWEB reserves the right to delete any messages with links it deems inappropriate. (return to form)
|
|
E-Mail Address
|
Your e-mail address will not be publicly viewable. Forum participants will be able to contact you using a contact link (included with your post) that is substituted for your actual address. You must include a valid email address in this field. (return to form)
|
|
Subject
|
Subject may be edited for length and clarity. Subject lines should provide an indication of the content of your post. (return to form)
|
|
Thread Related Link and Image Guidelines
|
Thread Related Links posted at WOODWEB's Forums and Exchanges should point to locations that provide supporting information for the topic being discussed in the current message thread. The purpose of WOODWEB Forums is to provide answers, not to serve as an advertising venue. A Thread Related Link that directs visitors to an area with inappropriate content will be removed. WOODWEB reserves the right to delete any messages with links or images it deems inappropriate. (return to form)
|
|
Thread Related File Uploads
|
Thread Related Files posted at WOODWEB's Forums and Exchanges should provide supporting information for the topic being discussed in the current message thread. Video Files: acceptable video formats are: .MOV .AVI .WMV .MPEG .MPG .FLV .MP4 (Image Upload Tips) If you encounter any difficulty when uploading video files, E-mail WOODWEB for assistance. The purpose of WOODWEB Forums is to provide answers, not to serve as an advertising venue. A Thread Related File that contains inappropriate content will be removed, and uploaded files that are not directly related to the message thread will be removed. WOODWEB reserves the right to delete any messages with links, files, or images it deems inappropriate. (return to form)
|
|
|
|
Member